Pearson, who has reportedly thrown his hat into the ring to become Norwich City's next boss, signed James for Leicester City five years ago.
The midfielder has impressed in two months at Barnsley while Nottingham Forest continue to slide towards the relegation zone.
Leicester's Matty James has joined Barnsley, allegedly turning down interest from Aston Villa and Nottingham Forest.
Nottingham Forest have reportedly made a loan offer for Leicester's Matty James - but he wants to join Barnsley.
Conor Hourihane has been heavily linked with a move to Aston Villa, and it appears that the path is about to be left clear for a switch.
January offers Villa the opportunity to make a statement of intent ahead of a crucial five-month spell.
It is claimed that Leicester are keen to loan out the 25-year-old, and a move to Aston Villa or Wolverhampton Wanderers could appeal despite Premier League interest.
The midfield maestro has been out of action since May 2015.
The midfielder has been out of action since last May.
Matty James is yet to make an appearance for Leicester City so far this season.